Mobile Payment Issues and Policy Implications: The Case of Korea

Abstract

This chapter introduces three mobile payment plans that have been launched in Korea: mobile banking service, mobile prepaid electronic cash service and mobile phone bill service. Based on the recent experiences of the Korean economy, this chapter discusses the regulatory and monetary policy issues associated with mobile payments. Mobile payments are superior to existing means of payments because of their efficiency and convenience and mobile network operators (MNOs) are on the verge of turning into non-bank financial institutions in their nature. The government needs to facilitate the crossbreed between banks and MNOs to accelerate the development of efficient payment instruments rather than hindering innovation in banking industry.